The sharer barer: Rachel Botsman on the new democracy

Rachel Botsman believes sharing is the new democracy. She tells Jasmine Gardner why she rents her baby kit, hasn’t owned a car for 14 years and teaches governments how to cut out middle men by shifting power to the people
Matt Writtle at stylish Soho Hotel, London, sohohotel.com
27 June 2013

If there’s one skill Rachel Botsman’s children will have honed, it will be sharing. The London- born, Sydney-based 35-year-old is essentially the world’s sharing expert. She is teaching businesses and governments how to make use of a “what’s mine is yours” philosophy that is changing the shape of our economy and cutting out the middle man.

“You will hear about collaborative consumption, the sharing economy, the peer-to-peer economy: they’re all essentially the same thing,” explains Botsman, who is currently writing her second book on the topic and who is in London to speak next week at an event for WIRED magazine, for which she is a contributing editor.

“It is how technology is transforming our relationship to assets and ownership. Technology unlocks the idling capacity — that could be the spare room in someone’s house, the spare seats in someone’s car, investments that you don’t have in a bank.”

Most of us will have had some experience of this. Airbnb is probably the best-known example, a website on which people let their spare rooms as hotel alternatives. Botsman mentions Hollywood star Bruce Willis, who has been trying to find a way of adding his extensive iTunes library to his will, to pass on to his children — which is not currently possible, even though he paid for the music. “A redistribution market for virtual goods will eventually emerge,” she says.

Entire new markets have indeed opened up, such as peer-to-peer loans or paying for someone to stay at your home to let in the gasman. “It’s a mass democratisation of everything,” says Botsman.

This sharing economy is rapidly disrupting conventional trade models so that “power is moving from the centre to the edges”, says Botsman, which after the banking crisis will sound like a good thing to many.

“The banks will start to lose some of their arrogance when they realise they are not needed — because of peer-to-peer mortgage companies, for example ... I think we’re going to look back in 30 years and say power really moved because of technology.”

Botsman grew up in Hampstead but moved to New York after studying at Harvard, and then to Sydney when she married her Australian husband, a barrister. She is conspicuously good-looking. Her only blemish is a scar that splits her left eyebrow — the result of her brother hitting her on the head with a tennis racket when she was five. “When I do television people can be quite nasty about it,” she explains. “I get comments like, ‘Does she not realise that she’s had a huge make-up malfunction?’” It’s a kind of meanness reserved for the beautiful.

She talks on her pet topic in the drawing room at The Soho Hotel with the same fluidity that she has on stage at TED talks. This is to be expected, since she has been speaking on and teaching the concept of collaborative consumption since 2008 when she decided: “I really wanted to start a global movement.” She had previously been working for the Clinton Foundation on behavioural change around childhood obesity and, before that, in brand management.

At the start it was a hard sell but mobile technology was the game-changer. The recession has also helped. “What it has done for business is make them open to new models of reinvention and sources of revenue, while individuals have been looking for better solutions.”

In Botsman’s case that has meant she and her husband have not owned a car in 14 years, despite having a two-year-old son. They use GoGet, a car club.

“We rent a lot of products, like the baby stuff. We swap a tonne. You become very aware of the capacity and the obsolescence of things.” They also let their house “whenever we travel” and Botsman has managed to find takers online for things as seemingly useless as a pile of gravel or a stack of coloured paper.

She admits that there is still resistance. “So many companies think they’re immune. They look at customer behaviour and say: ‘Owning something is the holy grail.’ Then you just point to cars. They were the holy grail of consumerism yet disruption has happened ... If I was a business in certain industries I would be rushing to reinvent myself.”

What can still be owned, however, is data. Already several start-ups, such as Trust Cloud, are working to aggregate your reputation so that you can take it with you around the web, like a passport. Botsman has seen examples of people “who use their data to get a better rate on their mortgage”.

But as companies own or have control over our data, power could merely switch from one type of company (the banks) to another (the web giants).

“We’ve been giving away data actively, and not realising it for 10 years ... We need to own our own data.”

The new market has other problems. In New York, one Airbnb host was recently fined $2,400 for letting his room through the website. The city’s rent restriction laws to prevent illegal hotels mean living spaces can’t be let for less than 29 days.

“Similarly, insurance is a big issue,” says Botsman. “In car sharing, if there’s a crash, where’s the liability?” Botsman is trying to work directly with cities and governments to find solutions. In London, she says, “you need Boris or Tech City’s [CEO] Joanna Shields to stand up and embrace this”.

What does this mean for her children’s generation? “I think they won’t just have one job, they will have several.”

Botsman is currently four months pregnant with her second child. It’s impossible to discern this by looking at her, however — and unfortunately for her, the sharing economy does not yet seem to exist for seats on the Tube.

Rachel Botsman is speaking at the WIRED MONEY financial event on Monday July 1 (wired.co.uk/money13)

SHARING SITES

Bla Bla Car

A car-sharing site. If you find yourself having to drive to Manchester, post the trip and find others who want to travel and share the costs. blablacar.com

Sorted

An errand-running site. If you can’t be bothered to walk the dog or you need dry cleaning picked up, find someone local to do it for you for a fee. sortedlocal.com

oDesk

Businesses who need a specific piece of work done can log on, find the right freelancer, check their hours online, hire them and pay them. odesk.com

Trust Cloud

Finds your online data (from eBay, Tripadvisor or Facebook, for example) and makes it a virtual “Trustcard” that you can take with you to use in peer-to-peer marketplaces. trustcloud.com

Funding Circle

Invests your money in businesses that need it and gets an average net return of 5.8 per cent. Or if you’re a business, find the funding you need from several individuals. fundingcircle.com

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